If national incomes of foreign countries fall at the same time the dollar appreciates, then in the United States, the aggregate demand curve
A) shifts to the right.
B) shifts to the left.
C) does not shift, but there is movement up along it.
D) remains unchanged.

Question

Quizplus · Accepted Answer

If national incomes of foreign countries fall at the same time the dollar appreciates, it will make U.S. exports more expensive, leading to a decrease in net exports. This will cause a decrease in aggregate demand, shifting the curve to the left.

If National Incomes of Foreign Countries Fall at the Same